Midcap IT Firms to Face Slowdown as Client Spends Come Down | In the News

Midcap IT firms, which were growing at around 25-45% year-on-year during the last few quarters due to the move towards digitization and cloud during the pandemic, are likely to face constraints this fiscal year. Some may also lag behind the already slowing big IT majors, analysts said.

On the falling valuation of stocks of some midcaps, Peter Bendor-Samuel, CEO of Everest Group, said, “We may see one or more of them merge or change ownership as valuations drop and private equity becomes more active.” Peter added, “The industry is going through a deceleration as discretionary spending is being cut as the post-pandemic boom finishes and firms enter a more mature phase of digital transformation.”

Read more in Financial Express.

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